Covid 19: Survival of the fittest or Adaptability to change?

June 9, 2020 Focus area: Strategic Flow , Continuous Innovation

By the time you finish reading through all of the advice you have been sent on how your organization could manage the impact of Covid-19, the impact of the virus will likely be contained enough for your company to return to some form of ‘new normal’. Yes, we will be left with an economic crisis for which we can blame the pandemic, politicians or the press, but the question is what the ‘new normal’ will look like. I lean towards a version of Amara’s Law: the impact of the pandemic will be overestimated in the short term but underestimated in the long term. Success does not await those that have adapted fastest to the 1.5-meter economy, but those that have become adaptable to change. Any change.

Up until a few years ago, when you walked into the California Academy of Sciences you would see, printed on the floor, a quote by Charles Darwin reading “It is not the strongest of the species that survives, nor the most intelligent. It is the one that is most adaptable to change.” Until some years ago, when research proved that Darwin had never actually said such a thing. The origin of the quote had been traced back to Leon C. Megginson, Professor of Management and Marketing at Louisiana State University in Baton Rouge. In 1963, Megginson stated in a class that ‘According to Darwin’s Origin of Species, it is not the most intellectual of the species that survives; it is not the strongest that survives; but the species that survives is the one that is able best to adapt and adjust to the changing environment in which it finds itself.’ He used the phrase to address the fact that organizations, like species, should adapt to their markets in order to survive. From this lecture on management, the quote started to lead a life of its own, and eventually ended up in big print on the floor of the California Academy of Sciences, even though Darwin himself had never said anything that even remotely resembled the quote. When the academy learned about this, it decided to remove Darwin’s name from the floor, leaving the famous quote intact. Darwin’s printed name, however, turned out to be quite resistant to change.

Megginson’s quote was likely the first parallel between evolution theory and management. And it has been highly debated ever since. After all, some reason, creating adaptability means not organizing for optimal efficiency and inefficiency in business is a bigger threat than a potential sudden change in market conditions. The dinosaurs, so the reasoning goes, could not have adapted to the comet anyway, and the cockroaches (one of the few species that did survive the comet) have not adapted ever since and are still annoying to this day. Covid-19 is to business today what the comet was for the dinosaurs. Sudden, severe impact and disruption. Adapting to Covid-19 is an extraordinary feat and favors those management teams that take the best measures the fastest, and then make the best prediction about ‘the new normal’. Adaptability is a call to action and the toughest teams take the glory. ‘Survival of the fittest’ more than ‘adaptability to change’.

But that is not the point Megginson (nor Darwin) tried to make. True, situations like the corona pandemic demand decisiveness and skill at the time the crisis is at its height. And then the ability to bring the organization back to a stable environment as quickly as possible. Yet, the new normal is anything but a stable marketplace. Covid-19 is an exceptionally big storm in an otherwise already unstable environment. In the last twenty years, the world has witnessed an unprecedented number of changes with significant impact on global business, including 911, the financial crisis, SARS, the Stuxnet virus, trade wars and now Covid-19. Cutting across all of that, digitization has created a truly global marketplace that has brought forth new cross-border competition and an accelerated pace of innovation. Covid-19 is not a single event, it is a dot on the line of continuous change. A big dot, but certainly not the last.

In my book ‘Continuous Innovation’ I describe how in 1942 the economist Joseph Schumpeter calculated that cycles of disruption (creative destruction) happened approx. every 15 years. In 1995, Clayton Christensen proved that those cycles had been reduced to 5 years. Today, substantial market change is likely to happen every 2 years or less. In that situation adaptability is actually more beneficial than efficiency. After all, changing an outdated organization to become efficient for today’s market, knowing that there will be a need to reorganize again after only a few years is far more costly than creating a continuously adaptable structure. Such an organization is an agile organization, meaning that it uses agile ways of working, business agility, decentralized decision making, lean portfolio management, lean budgeting, strategic flow and continuous innovation. Yes, all organizations will still need capable and decisive management teams in times of sudden crisis. But next to that they need an organizational structure that favors smooth continuous adjustment over operational efficiency. And yes, operational efficiency remains important, just not at the expense of adaptability.

Obviously, there is no simple and fast solution to create such an agile organization. But there hardly ever was a time that was better to start making changes to your existing structure than in the aftermath of Covid-19, when your decisive management team will redesign the new normal. When designing, keep the next three questions in mind:

- Rethink the adaptability of your organizational structure. Is it flexible enough to support your goals and ambitions during the capricious economic developments you’ll be facing in the coming years?

- Rethink the responsiveness of your business model. Is it fast enough to seize the opportunities and threats of the volatile marketplace?

- Rethink your innovation strategy. Are you capable of leading change through continuous innovation to stay ahead of competition?

Nobody can predict the next disruptive outbreak or crisis, but you can make sure that your organization is “able best to adapt and adjust to the changing environment in which it finds itself.” Don’t take it from Darwin but from a revered Professor in Management and Marketing.

Arent van ‘t Spijker is partner at BlinkLane Consulting and author of the book Continuous Innovation: How successful organizations continuously develop, scale, and embed innovations to lead tomorrow's markets.